SBAC
SBA Communications Corporation
$185.69
Real Estate Investment Trust
85%
P/FFO × Specialty REIT Multiple
Strong
·
Conviction
Undervalued
Trading 56.1% below fair value
You pay
$185.69
Bear
$344.83
Fair
$423.20
Bull
$501.57
Bear
$344.83
+85.7%
$14.43 FFO × 29x
Fair
$423.20
+127.9%
$14.43 FFO × 35x
Bull
$501.57
+170.1%
$14.43 FFO × 42x
Key Value Driver
FFO/share ($14.43) × specialty P/FFO multiple
Implied Market Multiple
12.9x
Summary
Our base-case estimate uses P/FFO × Specialty REIT Multiple. We then blend that result with the average analyst price target of $229.17 from 42 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $423.20 per share.
Warnings
Standard profit figures are misleading for real estate companies — large non-cash accounting charges make profits look artificially low. Dividend yield and funds from operations are better measures.
Wall Street's average price target is $229.17 (from 42 analysts). Our estimate is 121% above the consensus -- consider that gap carefully.
Key Risks
- P/E and EV/EBITDA are structurally wrong for REITs — use P/FFO and NAV
- Interest rate sensitivity: REIT multiples compress when rates rise
- FFO approximation (NI + D&A) may include gains on property sales — verify